The Case for Being Honest

Staff editor Kasey Wehrum has written for Inc. magazine on subjects ranging from the businesses behind professional bull riding to gadget inventor and father of the infomercial, Ron Popeil. His work has appeared in the New York Times, Worth, Budget Travel, and on MSNBC.com. He lives in Brooklyn.

WRITE A COMMENT

IMAGE:

Advertisement

Why it pays to be honest about your company's failures. In their latest ad campaign, Domino's pizza took a big gamble when they publicly admitted something that a lot of people already knew. Namely, that their pizza wasn't very good. In the ads, Domino's execs and chefs describe their pizza crust as "cardboard" and their pizza sauce as "ketchup." After this public confession, however, Domino's got to work revamping their pizza. They tried new ingredients, developed better crusts, and came up with a tastier sauce. Domino's experiment in honesty has paid off in a big way. The Chicago Tribune reports that sales at domestic stores soared 14.3 percent in the first full quarter after the new recipe debuted. One marketing guru explains why sometimes honesty is the best policy. "Times are tough," he says. "Most of us are disappointed with the actions of business and other institutions." Domino's gamble paid off because they could say, "We're one group that knows that." Hopefully BP is paying attention.

Performance reviews for CEOs. One disadvantage for CEOs of being at the top of the company pecking order is that it can be hard for them to get frank feedback on their performance. "It's a position that all-too-often only receives rigorous feedback and a thorough performance review when things go desperately awry," writes a post on ReadWriteWeb. The site breaks down the ways that Ben Horowitz, of the VC firm Andreessen Horowitz, evaluates CEOs. He says he doesn't look strictly at the company's financials, but rather at the CEO's knowledge, their ability to get their staff to act on that knowledge, and their ability to deliver desired results for the company. Here are some steps you should follow if you're looking to hire a CEO.

Do e-mail newsletters still work? So you're thinking of forsaking your e-mail newsletter for a blog or Twitter presence? Not so fast. Small Business Trends makes the case for continuing those daily e-mails. For one, newsletters can expand your audience to all those people who have yet to jump on the social-networking bandwagon. Odds are, they've still got an e-mail address. The story also points out that there's something to be said for the loyalty and trust a daily newsletter helps build. "A visitor's inbox is their trusted zone. And when you appear there on a regular basis, providing good content, you enable them to trust your brand and what you're offering," author Lisa Barone of Outspoken Media writes. Daily, or even weekly, e-mail updates will, at the very least, also remind people that your business exists, so when they're looking for a trusted vendor in your industry, you may be the first one they turn to. The last point Barone makes is that newsletters give you a free space to advertise product launches. As she puts it, "Trust + Awareness + Product = Sale."

Sports blog finds a buyer. Jason McIntyre, founder of The Big Lead, admits that when he launched the blog back in 2006 he already had his eyes on potential lucrative exit. "I said, 'Why not me?'" he told The New York Times. "Laurel Touby turned Mediabistro into $23 million." McIntyre didn't get $23 million, but today Fantasy Sports Ventures announced that it was acquiring The Big Lead for an amount in the "low seven figures." For the story in her own words on how Laurel Touby built Mediabistro, check out our How I Did It feature on her.

How Steve Jobs runs Apple. Like a giant start-up. In a on-stage Q&A at the D8 Conference, Apple founder and CEO Steve Jobs addressed a range of controversial issues, including his company's recent spat with Adobe, suicides at the factory that makes iPads, and even his sex life ("pretty good"). CBS News has a nice write-up and Engdaget has a rough transcript. Towards the end of the interview, Jobs described how he manages Apple. "We are the biggest start-up on the planet. No committees. The whole meets once a week for three hours," Jobs said, according to CNet's liveblog. "What I do all day is meet with teams of people...We have wonderful arguments...The best ideas have to win, otherwise you don't have good people who stay."

New start-ups trade bargains for personal info. Facebook is under increasing scrutiny for sharing users' private data without their consent, but would you willingly exchange your private data in return for a great deal? That's what a new crop of online start-ups are betting on, the New York Times reports. For example, budgeting website Mint.com will offer discounts from cable companies or banks to users who reveal personal financial data. One of the companies tells the Times that "the whole privacy debate has grown up around people using your data without your permission," but "if you want to use your data to your benefit, that's for you to do."